Cubitt Building & Interiors Ltd v Fleetglade Ltd

Where the adjudicator was appointed on the seventh day after the service of the notice of intention to refer, the service of the referral notice on the eighth day after the service of the notice of intention to refer complied with the requirements of clause 41A.4.1 of JCT 98

The adjudicator awarded the contractor a specified sum. Clause 41A.4.1 of JCT 98 provided that: (1) if an adjudicator was agreed or appointed within seven days of the notice of intention to refer a dispute, the referring party was to refer the dispute within seven days of that notice (2) if an adjudicator was not agreed or appointed within seven days of the notice of intention to refer a dispute, the referral to the adjudicator was to be made immediately upon such agreement or appointment. The notice of referral of the dispute was not, however, served by the contractor until the eighth day after the service of the notice of intention to refer a dispute where the adjudicator was appointed on the seventh day after the service of that notice of intention to refer.

Judge Coulson refused to accept the employer's contention in the court proceedings brought by the contractor to enforce the decision that the decision in the contractor's favour was a nullity because the notice of referral had been served "late" by the contractor. The judge came to this conclusion notwithstanding his initial finding that whilst the provisions of clause 41A.4.1 needed to be sensibly operated, they were nevertheless mandatory (and not discretionary). The judge came to his conclusion that the contractor had complied with the requirements of clause 41A.4.1 despite only having served the referral notice on the eighth day for the following reasons: (1) there was plainly an implied element of clause 41A.4.1 that if the adjudicator's appointment happened late on the last day of the seven day period after the service of the notice of intention to refer, the referral notice should be served immediately but (2) service the next day might well be good where, as in the instant case, the referral notice could not conveniently be served with all the supporting documents until the next day and (3) it would have been contrary to business common sense to have determined that the service of the referral notice on the eighth day in the circumstances of the instant case was out of time.